Social Networking and CRM Finally Hook Up

The big news when Saleforce.com released its latest version of what is hot in the CRM space -- Winter '08 -- was Force.com. The immediately understood subtext was that Salesforce.com (NYSE: CRM) had officially begun its migration to a platform on-demand company, launching the first salvo in what Denis Pombriant, managing principal of the Beagle Research Group, wrote could be the next platform wars.

A little lost in the hubbub of Force.com, though, was one accompanying module called "Salesforce.com Ideas," a Web 2.0 environment for collaboration in the enterprise. It is a productized version of what began as internal initiatives at both Salesforce.com and Dell (Nasdaq: DELL).

Salesforce.com is hardly the only CRM vendor to introduce, or try to introduce, social networking technologies into the CRM suite. For the last few years, companies have been playing with pilot projects and add-on modules to capitalize on the forums and blogs and other such Web 2.0 developments.

However, Force.com, either through planning or fortuitous timing, is among those offerings on the market now that have placed on equal footing these technologies with more traditional CRM functions.

Getting Legs

This trend of using and managing social networks has been huge, but it is only now that in CRM it is starting to grow legs, especially in the business-to-business sector, Mike Betzer, vice president of CRM strategy at Oracle (Nasdaq: ORCL), told CRM Buyer.

The hesitation and subsequent frustration -- what company likes being risk adverse when it comes to wildly popular trends -- was due in large part to the uncertainty of what would happen when consumers were given a voice. The problem was that they already were finding their voice online.

"People want to buy something, and they go online to find out what their friends or networks think about it," he said.

It was then, Betzer said, "companies began to realize they had to react to a changing environment where the customer is in control of the transaction."

Now, "we are seeing companies working hard to get their hands and vision around what happens when consumers are in charge and have so much information," he said.

"When people talk about relationships that is well and good, but it has to be a two way street," agreed Jeff Green, a principal with Gold Mobile.

Gold Mobile helps clients marry mobile technologies with social networking strategies.

"Communicating a brand with an audience that participates in that communication is where the industry is headed," he told CRM Buyer.

One project he is currently working on is for the hospitality industry, integrating a loyalty point program within a private social networking site that the firm is building.

"As a user of the site, if you get a friend to join or post a suggestion you will earn points towards products sold by the vendor partners," he explained.

Forum Technologies

Other endeavors are focused on the forum technologies, says Marchai Bruchey, chief marketing officer at Kana.

"This technology allows for a community of users of your products or services to share ideas, tips and even fixes for service problems," she told CRM Buyer. "The smart company is the one that monitors and integrates these forums into the customer support and development organizations allowing them to hear the voice of the customer and to get information that can be used to further develop the product or service to better meet customer needs and requirements."

The most common use of this, she said, is in the consumer high tech industry.

Internal Use

Other firms are focusing on using these technologies to make their applications more Web 2.0-friendly.

"Web 2.0 can be a misleading term because it often refers to both the technology and the cultural phenomenon of social networks," said Shawn Broxson, a director at Q-Industries.

"SugarCRM 5.0 and Ajax are good examples of a front-end approach that provides a more interactive user experience -- a fat client feel in a Web application," he told CRM Buyer. "This is a relatively new way of providing a 'live' Web page without reloading the browser.

"By adding a social network analysis module to SugarCRM, you now add a dimension where you can look at contacts in entirely different light -- in terms of how people are related. With conventional CRM systems, you can search and organize, but you cannot visualize how people are related," Broxson said.

"What's useful or important about a CRM system is that this is the universe or environment that you've built and populated -- it has meaning -- and now you have tools to establish where the second, third, fourth order relationships are and how you can leverage them. You can judge the strength of relationships several levels down. This is considerably different from an external world -- like LinkedIn -- that you did not create or populate," he concluded.